Israel: Inflation falls further below target range in January
Consumer prices fell 0.4% in January over the prior month, down from December’s flat reading. January’s fall was driven by lower clothing prices.
Inflation decreased from 0.6% in December to 0.3% in January, moving further below the Bank of Israel’s 1.0%–3.0% target range. Recent low inflation comes on the back of weak oil prices and a strong currency. The latest inflation reading will add to calls for monetary easing, although the Central Bank appears reluctant to lower rates, and is instead opting to intervene in the FX market in a bid to support the currency and price pressures.